I’m 25 and currently have $27,000 in debt, with about $14,000 of that being student loans. The rest is mostly credit card debt. My income is $855 per week, but I feel like I’m stuck in a cycle where I can only make minimum payments because the interest keeps piling up. My credit score is down to 580, and my card rates are in the high 20s. I’ve tried cutting back on spending, but I still feel overwhelmed. How do I get out of this mess? Any help is appreciated.
You’re bringing in $855 a week, so where is all the money going? You might need to take a hard look at your spending.
Tyler said:
You’re bringing in $855 a week, so where is all the money going? You might need to take a hard look at your spending.
I definitely spend more than I should. I went through my transactions on Rocket Money and realized I’ve been wasting a lot on unnecessary things. I’m trying to fix these habits now.
@Parker
Sounds like you need a good financial reality check. There are some helpful YouTubers out there, like Caleb—you should check him out.
Can you share more details, like how much you owe on each card and their interest rates? Also, what’s the rate on your student loans?
Pax said:
Can you share more details, like how much you owe on each card and their interest rates? Also, what’s the rate on your student loans?
I just added the details. Thanks for asking!
@Parker
Your weekly income is $855, which is about $3,420 a month. What are your main expenses? Rent, utilities, groceries? And how many credit cards do you have? What’s the balance on each?
With your credit score, consolidation loans and balance transfers might not be an option. I’d suggest credit counseling—they can help lower your rates and monthly payments. Also, stick to a strict budget.
You’ve got to stop using the cards altogether. If you keep adding to the balances, you’ll never make progress. Can you share your other bills? Have you thought about getting a second job?
Daire said:
You’ve got to stop using the cards altogether. If you keep adding to the balances, you’ll never make progress. Can you share your other bills? Have you thought about getting a second job?
I’ve been considering a second job. If I do, all that extra income will go straight to the debt.
Start by paying off the smallest debt first and use the snowball method to build momentum. You can do this!
Since your credit score is low, focus on the card with the highest interest rate first (the avalanche method). Only spend on essentials like rent, groceries, and utilities. Avoid impulse buys and put vacations on hold. If you need help, maybe ask your parents for a small loan to get ahead.
@Pax
I’ve already cut out all non-essential spending. I’m a big car enthusiast, and that used to be my biggest expense, but I’ve put all of that on hold for now.
It sounds like your expenses are higher than your income. Have you made a detailed budget? Look at your past bank statements to figure out exactly where your money is going. Cut out things like eating out, extra subscriptions, and unnecessary purchases. Also, a second job could help.
@Sky
I started cutting back last week. I’ve canceled a lot of subscriptions and even moved back in with my parents to save on rent. I’m also trying to limit eating out.
Parker said:
@Sky
I started cutting back last week. I’ve canceled a lot of subscriptions and even moved back in with my parents to save on rent. I’m also trying to limit eating out.
That’s a great start! Are you paying for a car loan? If not, that’s one less thing to worry about.
@Sky
No car loan—I work in the automotive industry and own all my vehicles outright. I’m just trying to get everything else under control now.
@Sky
I honestly feel like I let things spiral out of control and didn’t realize how bad it got until now.
Parker said:
@Sky
I honestly feel like I let things spiral out of control and didn’t realize how bad it got until now.
We’ve all been there. If you’re living with your parents and have no car payments, you might be able to put $2,000 or more a month toward the debt. That could help you clear it in about a year.
@Sky
I’m waiting on a raise right now. Once I know exactly how much I’m working with, I’ll figure out the bare minimum I need to live on and put the rest toward the debt.